EUR/GBP Price Analysis: Bulls await a sustained move beyond descending trend-channel

• EUR/GBP gained traction for the second straight session and move further away from the 0.9000 mark.
• The technical set-up supports prospects for a bullish breakout through a descending trend-channel.
• Any meaningful dip below the 0.9070 support might be seen as a buying opportunity near 100-DMA.

The EUR/GBP cross gained traction for the second consecutive session and recovered further from the key 0.9000 psychological mark, or five-week lows touched on Wednesday. The positive momentum lifted the cross back towards the top boundary of a one-month-old descending trend-channel.

Given that the EUR/GBP cross has been showing some resilience below 100-day SMA, a convincing breakthrough will be seen as a fresh trigger for bullish traders and set the stage for additional gains. The cross might then accelerate the move back towards reclaiming the 0.9200 mark.

Meanwhile, oscillators on the daily chart have just started moving into the positive territory and support prospects for a bullish breakthrough the trend-channel. Hence, a subsequent move to the recent daily closing highs, around the 0.9255-60 region, now looks a distinct possibility.

On the flip side, any meaningful slide below the 0.9070 region might continue to attract some dip-buying near the 100-day SMA and remain limited. That said, sustained weakness below the 0.9000 mark will negate any near-term bullish bias and pave the way for further weakness.

The downward momentum might then drag the EUR/GBP cross further towards the trend-channel support, which is currently pegged near mid-0.8900s. Some follow-through selling will set the stage for an extension of the recent pullback from the vicinity of the 0.9300 round-figure mark.

EUR/GBP daily chart

Technical levels to watch